U.S. Chamber of Commerce CEO says protectionism is baaaad…
In a speech to the Detroit Economic Club, the CEO of the U.S. Chamber of Commerce, Thomas Donohue, stated that protectionism and isolationism is not an appropriate way to save the auto industry. Donohue said that a protectionist policy will only hurt American jobs and the economy. Additionally, he said that said policies would also hurt America’s commitment to its global trade rules.
While I agree with Mr. Donohue, and other economists, about isolationism and protectionism not being a good policy, I believe that Mr. Donohue does not see the bigger picture. As I have stated (or ranted) before, this is not about protectionism; this is about playing the global trade game fairly. The United States has one of the most open trade policies of any other nation. Countries that are part of the European Union tend to practice protectionism on a level that makes it fair for their domestic companies to compete with foreign competitors.
But what about countries like Japan? Do they practice free, or fair, trade? No; they do not. They are not even close to practicing fair trade. Otherwise GM would sell more than 10,865 vehicles in Japan in 2008 (this is after a 35% sales increase from the previous year); there were 5.08 million vehicles sold in Japan last year (6% decline from 2007). A quick calculation shows that GM had a market share of 0.214%; wow, that is awesome!
Read the article at The Financial.
Tags: General Motors, GM, Thomas Donohue
